J.P. Morgan Healthcare Conference kicks off Monday with focus on Trump, Amazon

Investing

Health-care’s biggest annual gathering — the J.P. Morgan Healthcare Conference — starts Monday in San Francisco as the industry grapples with threats from Washington to Silicon Valley.

More than 485 companies from biotech, pharma, insurance, hospital systems and more will give investor presentations to more than 9,000 attendees at the Westin St. Francis this year. Even more consulting companies and law firms will flood hotel suites and conference rooms near Union Square to host meetings that executives compare to speed dating for investors.

In its 37th year, the four-day conference has helped shape the agenda for both the industry and individual companies for the year. Some executives share their financial forecasts or milestones investors can expect from drug pipelines. Others touch on themes for the industry, with tax reform being a major focus last year.

Drug prices will likely be a major topic this year. As president-elect two years ago, Donald Trump made his now-infamous comment during the conference that drug companies were “getting away with murder.” Since then, he has installed Scott Gottlieb as Food and Drug Administration commissioner and Alex Azar as Health and Human Services secretary with instructions to lower drug prices. (Gottlieb was scheduled as a keynote speaker Tuesday but had to bow out due to the federal government shutdown.)

Health care’s intersection with technology will also likely be a major theme throughout the week. One name stoking both excitement and fear: Amazon.

The company’s worried Wall Street for some time now. But Amazon’s entry into the industry is no longer hypothetical with its purchase of online pharmacy PillPack last year.

Some investors worry what this will mean for drugstores and middlemen, like pharmacy benefit managers, as well as distributors.

The industry is in a state of flux, and that change will dominate the week. How drug companies can grow in a world where it’s getting harder to raise prices without igniting a Trump tweet. Pfizer CEO Ian Read delayed plans to raise prices on several drugs after Trump tweeted in July that “Pfizer and others should be ashamed that they have raised drug prices for no reason.”

How the once well-defined lines between sectors are blurring, especially now that CVS Health has closed its acquisition of Aetna and pharma giant Bristol-Myers Squibb announced last week plans to acquire biotech behemoth Celgene.

What happens with the joint venture between J.P. Morgan, Berkshire Hathaway and Amazon and whether other employers will try to tackle lower health-care costs on their own.

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